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Oil gains ground, gold struggling

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Oil rallies after strong US numbers

Oil prices rallied after another round of impressive US economic data boosted optimism for an improving crude demand outlook. The US economy still looks good and China’s economy could be ready to bounce back fairly soon.  Momentum from yesterday’s bullish EIA crude oil inventory still lingers, but technical resistance at the $90 a barrel level is capping WTI’s rally for now.

OPEC Secretary General Al Ghais reminded energy traders that OPEC could be in a position to cut production if needed.  OPEC is not going to let this pullback with oil prices continue much further.

Gold

Gold is locked up in battle with King Dollar. The US dollar might continue to strengthen if US economic data continues to surpass expectations.  After breaking below $1800, gold has been struggling to regain its footing.  Aggressive rate hikes globally, today from the Philippines and Norway, are keeping the pressure on non-interest-bearing gold.

Gold looks like it could be forming a trading range between $1750 and $1800 as investors will slowly refrain from massive positioning until we get beyond the Jackson Hole Symposium.  Jackson Hole might not trigger any major surprises as the Fed seems locked into its data-dependency mode.

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Ed Moya

Ed Moya

Contributing Author at OANDA
With more than 20 years’ trading experience, Ed Moya was a Senior Market Analyst with OANDA for the Americas from November 2018 to November 2023.

His particular expertise lies across a wide range of asset classes including FX, commodities, fixed income, stocks and cryptocurrencies.

Over the course of his career, Ed has worked with some of the leading forex brokerages, research teams and news departments on Wall Street including Global Forex Trading, FX Solutions and Trading Advantage. Prior to OANDA he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news.

Based in New York, Ed is a regular guest on several major financial television networks including CNBC, Bloomberg TV, Yahoo! Finance Live, Fox Business, cheddar news, and CoinDesk TV. His views are trusted by the world’s most respected global newswires including Reuters, Bloomberg and the Associated Press, and he is regularly quoted in leading publications such as MSN, MarketWatch, Forbes, Seeking Alpha, The New York Times and The Wall Street Journal.

Ed holds a BA in Economics from Rutgers University.
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